To help relieve the additional financial burden caused by the increase in consumption tax, the government is offering a one-time cash payment (called a ‘sumai kyufu‘) of between 100,000 ~ 500,000 Yen to home buyers. The offer is available from April 2014 to December 2021.
Who is eligible?
- The cash payment is only available to owner-occupiers who earn below specified taxable income levels (see below).
- It can only be claimed once.
- If you jointly own the property, your payment will be reduced based on your share of ownership (eg. if you own a 50% share in the home your payment will only be 50%). Both owners must apply separately for the payment.
- You have to be able to prove you live at the address (eg. your resident card will be required as proof).
- You must have taken out a mortgage on the property, or must be over the age of 50 and have an annual income below 6.5 million Yen.
*Non-residents are not eligible for the cash payment.
What kind of properties are eligible?
It only applies to homes and apartments that are subject to the 8% or 10% consumption tax upon purchase.
- Brand new homes or apartments sold by the developer
- Pre-owned homes or apartments where the seller is a real estate company or consumption taxable entity
- Floor area is over 50 sqm (inner-wall measurement for apartments, and center-wall measurement for detached homes)
*It does not apply to the purchase of a pre-owned home or apartment from a private seller as these sales are generally not subject to consumption tax (although some exceptions may apply).
*There are other exemptions that may apply depending on the terms of sale and type of warranty provided on the property.
How much can you receive?
The cash payment will be determined by your prefecture tax income, which takes into account deductions such as dependents. There is a simulation calculator here (in Japanese).
|8% Consumption Tax (April 2014~)|
|<4,250,000 Yen||300,000 Yen|
|4,250,000 ~ 4,750,000 Yen||200,000 Yen|
|4,750,000 ~ 5,100,000 Yen||100,000 Yen|
|10% Consumption Tax|
|<4,500,000 Yen||500,000 Yen|
|4,500,000 ~ 5,250,000 Yen||400,000 Yen|
|5,250,000 ~ 6,000,000 Yen||300,000 Yen|
|6,000,000 ~ 6,750,000 Yen||200,000 Yen|
|6,750,000 ~ 7,750,000 Yen||100,000 Yen|
*Taxable income is based on a family with one income earner and two dependents. For example, if you do not have any dependents, the taxable income level will be higher than the table above. Eg: If you have an annual income of 4 million Yen and no dependents, you may only be eligible for a payment of 200,000 Yen under the 8% consumption tax rate or 400,000 Yen under the 10% tax rate. The simulation calculator can be found here.
How to apply?
- You can apply via post or in person at designated Sumai Kyufu offices.
- Must apply within 1 year of purchasing the property.
Some of the documents required include :
- Tax declaration certificate (kazei-shomeisho)
- Purchase contract
- Home loan contract
Application forms can be downloaded here (in Japanese).
It may take 1.5 ~ 2 months before payment is sent to your nominated bank account.
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